SquareBook

Edinburgh

Seeking investment

Overview

Story

Team

SquareBook is an innovative ecosystem that empowers issuers to regain control over the IPO process. Powered by state-of-the-art technology, SquareBook facilitates the full IPO process – preparation, marketing and execution – in a fair, transparent and efficient way.

The streamlined approach reduces friction, ensures regulatory compliance, and improves outcomes and efficiencies for all participants.

For growing firms:

We provide an expanded capital pool to include high quality private and smaller institutional investor participation. Issuers get better visibility and early interaction with investors through our innovative ecosystem and real-time transaction insight. And our streamlined approach, along with access to highly engaged investors, drives better pricing and long-term shareholding.

For advisors:

Advisors and syndicates benefit from improved efficiencies and regulatory compliance as outdated manual processes are replaced with the SquareBook rules-based technology.

Real-time insight into the book-building process improves pricing efficiency and fairness over final allocations. The allocation process also helps to demonstrate impartiality and justify final decisions.

SquareBook’s multimedia content helps meet regulatory requirements for early disclosure, helping sponsors reduce execution risk. The platform also enables sponsors to ensure all analysts engaged in a transaction – connected and independent – have equal access to all relevant information.

SquareBook improves competition by providing an independent and objective evaluation of sponsor performance.

For institutional investors:

SquareBook provides a single source of access to IPO opportunities in a fair, efficient and regulation-compliant environment.

SquareBook has removed the barriers to entry, enabling all level of institutional investors – large or small – to participate in primary market IPOs.

Allocations are based on issuer requirements rather than advisor relationships, and all investors receive equal access to issuer communications and broadcasts via our platform.

For retail investors:

Previously only available to large institutional investors, the retail investor now has the same access to information, investment opportunities and pricing in IPO transactions where issuers welcome retail participation.

The SquareBook ecosystem facilitates a media-rich information flow between investors and issuers.

Private investors can filter IPO opportunities based on their needs-based profiles.

For retail intermediaries:

Retail intermediaries benefit from increased volumes in transactions and customers as SquareBook removes barriers to private investors participating in IPOs.

We enable access to more information about prospective IPOs than ever before. Partnering with SquareBook therefore allows intermediaries to offer more investment opportunities to their client base.

For Society:

SquareBook demonstrates that a profitable business can have a social impact. We redirect a substantial percentage of profits to fund scholarships, allowing disadvantaged young people to realise their full potential.

We provide a mechanism to ensure more financial resources are channelled back into the local economies of the firms who work with us.

SquareBook came about in response to several complimentary factors. On the one hand, we saw opportunities presented by the sea-change in the regulatory landscape surrounding IPOs, and the financial system more generally, since the 2008 crisis. Regulators around the world have been working to introduce new rules which focus on ensuring that financial services intermediaries operate in the best interests of those seeking to raise money or invest.

Regulated firms involved in the IPO process must demonstrate that clients are handled fairly. For example, research and trading are being unbundled to ensure that clients receive best execution for the former, and ex-ante payment agreements for the latter (if indeed they are expected to pay).

Another, perhaps even more fundamental, driver is the general perception of IPO as being a broken model for firms wanting to raise capital. The FCA has produced multiple pieces of research in recent years highlighting various factors which jeopardise the quality of the primary market and reduce public confidence in its operation. These issues include the pricing of IPOs, distortions in the stock allocation process and distortions resulting from the primacy of connected research, to the exclusion of independent research. The current way of doing IPO simply does not represent the most efficient allocation of everyone’s resources.

We see value in the use of IPO as a means for firms to access the capital they need to grow, not least because (as the European Commision has noted) many of the alternatives mean “European businesses remain heavily reliant on banks, making our economies vulnerable to a tightening of bank lending.” Our mission is therefore to fix the IPO model, and make it fair, transparent and efficient for all participants.

SquareBook’s founders, Joe Sluys and Mark Parnell-Hopkinson, have 35 years of combined experience in the financial industry – both in Recognised Investment Exchanges launching IPOs and through third party service provision.

Joe and Mark identified areas where the allocation process for new equity issues could be streamlined, thereby enhancing the traditional relationship-led approach to the business. They acquired a small software business to assist banks and brokers in dealing with these equity issues.

Following the FCA’s publication of Occasional Paper 15 in April 2016, Joe and Mark researched allocation methods in international markets and devised a design for a new regulation-compliant platform. SquareBook was born in January 2017 and after a successful application, our platform was included in the FCA’s innovation hub.

We raised our first round of seed funding towards the end of 2017 and, combined with support from Scottish Enterprise (who have identified us for inclusion in their High Growth programme), have been able to bring on board a great team of software developers and other key hires based both at our HQ in Edinburgh and at the satellite office we opened in London in early 2018.

Our platform has developed to MVP stage and we are working through phase 1 testing with a large Buy Side firm, as we progress towards full FCA authorisation. Big things are on the horizon, as we are set to begin working with the Sell Side in order to conduct our first “real world” IPO. We are in discussions with investors who will help us move to the next level, where we develop our platform and add exciting new features to our IPO ecosystem, taking us closer to our goal of a revitalised IPO environment helping to drive growth and prosperity here in Scotland, and beyond.

Joe Sluys – CEO

Joe is an Economics graduate whose career began in 1999 with the Investment bank WestLB. He has spent the vast majority of his career working for or with regulated businesses, technology and investment banking. In 2005, Joe founded an IT consultancy business which he ran for 10 years working with over 50 regulated institutions, including Goldman Sachs, JP Morgan, Brewin Dolphin and BlackRock.

Mark Parnell-Hopkinson – COO

Mark’s career began in 1995 providing trade floor support for County NatWest. After providing IT and operations services to various City firms for 12 years, he became Head of IT and Operations for Mint Equities and spent two years on the business management team at BGC Partners. For the past six years, he has been providing consultancy services to a range of UK-regulated businesses, assisting with core technology issues.

Alistair Sutherland – CTO

Alistair is a graduate in Computer Science and has worked as a software engineer and architect for over 15 years. He has experience across multiple industries and managing global teams. For the past two years he has been chief architect on key back and front office systems for investment banks including Goldman Sachs and Northern Trust.

Richard Balarkas – Non-Executive Chairman

Richard Balarkas is an award winning industry veteran who has pioneered electronic trading and developments in market structure. He has held senior sales and business management roles at the London Stock Exchange, BZW, Instinet and Credit Suisse where he built and ran its global #1 ranked electronic trading business. He is a board member of CBOE Europe, Saxo Capital Markets Ltd, an advisor to the board of Compliance Solutions Strategies, and a Director of FIX Protocol.

Phil Dixon – Non-Executive Director

Phil is an experienced COO, CFO and FCA chartered accountant with over 25 years experience in financial services, investment banking and stockbroking, including COO for Cantor Fitzgerald Europe. He was a founding partner and CFO for Code Securities, a small-cap stockbroker which specialised in bio-tech IPOs, later bought by Nomura.